- Previous year's financial statement will give light to the auditor of the expectation on the
disclosure of the current financial statement thus aid auditor's planning.
- Use of previous year's financial statement reduces auditor's risks in the current financial
statement.
- The auditor \N ill be able to find out the likely areas of difficult in his audit work while
carrying out an auditing assignment while using the previous year financial statement.
- The auditor will be able to compare the current and the previous year financial statement
and determine for any material change in the business and the reason for such changes
this will enable him to report on the position of the business as a going concern.
- The use of previous year's financial statement will enable the auditor to evidence that will
support him to report on the true and fair view of the current financial statement.
Kavungya answered the question on May 14, 2019 at 13:32
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